Bharat Forge Ltd.
Auto · NSE
52-week range
₹1,074 – ₹2,044
From 52w high
-2.7%
RSI (14)
67.9
vs SMA 50 / 200
↑ 50 · ↑ 200
Bharat Forge (₹1,989.7) is an NSE-listed auto-components and industrials company that posted FY26 revenue growth of 11.2% YoY but saw Q4 FY26 profit decline 17.5%, dragged by impairments and restructuring. Over 1 year the stock has gained 78.7%, trading above its 50-DMA (₹1,817) and 200-DMA (₹1,457) and within 2.7% of its 52-week high, while the trailing PE of 88.3x is the highest among ranked Auto sector peers.
- ✓Revenue CAGR of 17.5% over 5 years demonstrates consistent top-line compounding; management guided 25%+ India business growth for FY27, with FY26 Q4 showing an export rebound.
- ✓Price sits 36.6% above the 50-DMA (₹1,817) and 36.6% above the 200-DMA (₹1,457), with a 52-week drawdown of only -2.7%, indicating price has held near recent highs across both short and medium-term moving averages.
- ✓FCF was positive in 4 of the available persistence years, suggesting the business generates operating cash flow even through cycles of earnings pressure.
- ✓Forward PE of 40.8x is substantially below the trailing PE of 88.3x, implying the market is pricing in significant near-term earnings recovery relative to current reported earnings.
- ✗5-year earnings CAGR of -17.9% against revenue CAGR of +17.5% is a structural divergence: the company has grown sales while eroding profitability, with Q4 FY26 profit down 17.5% YoY on impairments and restructuring.
- ✗Trailing PE of 88.3x is the highest among all 6 ranked Auto sector peers, while ROE of 11.6% has never exceeded 15% in the available window — a combination of peak valuation and below-sector returns on equity.
- ✗Quality score of 20/100 ranks last (6th of 6) among sector peers; the next-lowest peer scores 31, and the sector leader (BAJAJ-AUTO) scores 55. This reflects weak profitability, consistency, and capital efficiency metrics.
- ✗Profit margin of 6.42% combined with a D/E ratio of 76.5 (percentage basis) and flat debt trend reduces financial flexibility if the FY27 growth guidance is not delivered.
- ·Q4 FY26 results (reported May 7, 2026) showed revenue growth alongside a 17.5% profit decline; the company attributed the shortfall to impairments and restructuring charges and declared a ₹6.50 dividend.
- ·Management provided FY27 guidance of 25%+ growth in the India business segment and cited a Q4 export rebound, framing the current earnings weakness as transitional rather than structural.
- ·Mean analyst rating of 2.82 across 23 analysts (1–5 scale, lower = more constructive), indicating mixed analyst views on the stock at current levels.
- ?Does the 5-year gap between 17.5% revenue CAGR and -17.9% earnings CAGR reflect recurring restructuring and impairment cycles, or a structural shift in the cost base that management's FY27 guidance addresses?
- ?At a trailing PE of 88.3x (the highest among Auto sector peers) and a forward PE of 40.8x, how much earnings recovery is priced in — and what assumptions about margin normalisation does that imply?
- ?The ROE of 11.6% has not crossed 15% in the available history; what operating levers or business mix changes would be required to move capital returns to levels more in line with high-quality industrials?
- ?Given that the stock has gained 78.7% in 1 year while earnings declined, what new information — product wins, export diversification, defence segment ramp — would be needed to confirm or challenge the market's forward thesis?
PE
88.3
Forward PE
40.8
ROE
+11.6%
Profit margin
+6.4%
D/E
76.47
Dividend yield
+0.4%
Quality score
20/100
ROE 5y above 15%
0/5 yrs
FCF 5y positive
4/5 yrs
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.Analysis generated 11 May 2026.